Banks face credit growth, credit cost, NIM challenges: Alchemy Capital#39;s Alok Agarwal

1 month ago

According to Agarwal, NIMs are expected to shrink due to anticipated decreases in repo rates, as downward rate cycles typically lead to their contraction

March 04, 2024 / 10:11 AM IST

 Alchemy Capital's Alok Agarwal

The weight of Banking and Financial Services shares in Nifty in February has fallen to 33 percent as per the latest factsheet from Stock Exchange, as compared to a 38.45 percent weightage in April 2023.

Since improvement in the trinity of credit growth, credit cost, and net interest margins for banks is probably behind us, investors may find better opportunities elsewhere, said Alok Agarwal, Head - Quant and Portfolio Manager at Alchemy Capital, in a conversation with Moneycontrol. Banks face challenges on all three fronts and there is no probability that they will rise from here, he explained. The biggest banks will find themselves in a sinking boat if they fail to meet estimates because of...

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